Sasol Limited
(Incorporated in South Africa)
(Registration number: 1979/003231/06)
ISIN Code: ZAE000006896
JSE Code: SOL
NYSE Code: SSL
("Sasol")
TRADING STATEMENT: CLARIFICATION OF FINANCIAL EFFECT OF RETAINING THE
SASOL OLEFINS AND SURFACTANTS (“O&S”) BUSINESS
Background
On 1 August 2005, Sasol announced its intent to divest of the O&S
business, subject to fair value being obtained.
In an announcement of 5 September 2006 it was indicated that the O&S
business will be written down to fair value.
On 30 March 2007 Sasol announced that it had terminated the planned
divestiture process and would retain the O&S business. The announcement
indicated that the O&S business will cease to be classified as being
"held-for-sale" for accounting purposes and will be shown as part of
"continuing operations".
As a consequence, the results of O&S have been reincorporated into
continuing operations and will no longer be disclosed as a separate
line item, viz discontinued operations, in the income statement.
In Sasol’s interim financial results for the six months ended 31
December 2006, published on 5 March 2007, the following earnings
outlook was indicated: “Assuming slightly lower oil and commodity
chemical prices and a marginally stronger rand relative to the first
six months, earnings in the second half are expected to be lower than
those of the first half. Satisfactory earnings growth for the full
financial year is, however, expected.”
Financial effects resulting from the change in classification of Sasol
O&S
At the time of the release of the interim financial results, Sasol O&S
was still categorized as an asset “held for sale” and its results
reported as a discontinued operation in the financial results. The
earnings growth outlook released accordingly referred to the
attributable earnings outlook on “continuing operations” only. The
“satisfactory earnings growth” remains the profit outlook for the full
financial year if 2006 attributable earnings on continuing operations
are compared to 2007 attributable earnings excluding Sasol O&S.
However, mainly due to the Sasol O&S fair value write down of R2,8
billion after tax in the 2006 financial year which is not repeated in
the 2007 financial year, attributable earnings per share in the 2007
financial year are expected to be between 55% and 65% higher than those
achieved in the previous financial year. Headline earnings per share
(which in 2006 excluded the effect of the fair value write-down) are
expected to increase by between 5% and 10%.